Source link : https://love-europe.com/2024/10/07/ireland/data-centres-in-europe-kpmg-ireland/
For most of the past 2-3 decades, data centres and related digital infrastructure have been largely outside of the public view. Already critical parts of our modern lifestyle and economy, from enabling our smartphone use to reducing road accidents and helping with everything else in between, they have sprung up in multiple clusters globally, including Europe, largely as anonymous buildings.
As existing drivers for this build out, like cloud adoption, or increased use of sensor technology, come up against an energy grid already struggling to decarbonise, data centres are increasingly entering the policy landscape and public consciousness.
Added to this, within the space of just a couple of years, AI has leapt from the fringes of public awareness into the mainstream. World leaders are falling over themselves to intone on the revolutionary potential of the technology, and businesses are scrambling to understand and deploy it.
Whether hype or sustainable trend, this use of AI only adds to the already strong demand for growth in data centres – demand that is struggling to be met as data centre operators struggle with access to energy, specialist build skills, and supply chain backlogs.
According to Gartner, worldwide public cloud end-user spending is growing at over 20% and is set to surpass a trillion dollars before 2040.[1]
Data centre infrastructure – critical to meeting such demand – is therefore increasingly pivotal to Europe’s digital economy, underpinning innovation, competitiveness, and the growth of priority sectors like AI, digital health, financial services, ecommerce, defence, cybersecurity, whose players need access to low-cost storage and compute in order to innovate and grow.
Data centres also act as catalysts for growth, since data centre hubs naturally create commercial ecosystems that attract a spectrum of businesses, suppliers, and talent. All of which is spurring frenetic construction of a variety of data centre types and sizes.
According to commercial real estate operator CBRE, the European market grew by nearly 20% year-over-year in Q1 2024, with new clusters emerging in the Nordics and southern Europe, as well as significant development in some of the more established ‘FLAPD’ markets (Frankfurt, London, Amsterdam, Paris, Dublin) – though notably Amsterdam and Dublin are falling behind.[2]
Despite broad growth, Europe lags behind both China and the US in data centre construction. According to recent research, Europe is currently home to around 1,200 dedicated data centre sites[3] compared to the US’s ~5,000, with inventory growth in 2024 of over 24% in North America compared to 20% in Europe. In practice, our work in the sector suggests the European supply chain is struggling to build at higher than around 13% compound growth rates.
These findings are mirrored in investment in AI more broadly, where sums in the US and China far outstrip those in the EU[4], threatening European pretensions to technology leadership. The EU’s claims to regulatory leadership on AI are also likely to suffer if it does not physically host the infrastructure that is AI’s most enforceable dimension.[5]
Given data centres are also relatively power hungry, it is perhaps no surprise that Europe, with its greater emphasis on ESG and the energy transition, risks falling behind. The UK’s new government, meanwhile, wishes to flag that the country is very much open for business from data centre investors.
Source link : https://kpmg.com/ie/en/home/insights/2024/09/data-centres-in-europe-strategy.html
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Publish date : 2024-09-23 14:19:02
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The post Data centres in Europe – KPMG Ireland first appeared on Love Europe.
Author : love-europe
Publish date : 2024-10-07 12:02:50
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